Video: Newt gives a reluctant “yes” to bailout

posted at 3:32 pm on September 28, 2008 by Ed Morrissey

Newt Gingrich appeared this morning on ABC’s This Week with George Stephanopolous, and gave a very reluctant endorsement of the bailout package as described in reports this morning:

STEPHANOPOULOS: “Speaker Gingrich, there’s also, I think, a recognition, at least in some of the polls I’ve seen, that something has to be done.”

SPEAKER NEWT GINGRICH: “Sure, look, something has to be done. … I suspect were I still in Congress, in the end George [Will] is right, and I probably would end up voting reluctantly yes, because I think when you’re given no choice …”

I’ll try to get more of Gingrich’s remarks. He makes a good point in the comments here that we’re buying years of bureaucracy for a short-term problem, but the problem will be a lot longer than just two weeks if government doesn’t act to support the prices on the mortgage-backed securities (MBS) that it insisted Fannie Mae and Freddie Mac issue on boatloads of bad loans. Without action, the collapse would probably take place in two weeks, leaving us years to pick up the pieces — and that would cost more than what’s being proposed.

Will Gingrich’s reluctant, watered-down endorsement make conservatives more willing to accept this solution?

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“So, what did the Republicans achieve? They put strings on the availability of funds beyond $250 billion, requiring fresh Congressional action for the last $350 billion. They added a requirement that Treasury establish an insurance program which would be funded by participating companies. This may be a big deal; I’m not sure exactly how it is intended to operate or how much, in the end, it will reduce the exposure to the taxpayer. They established a bipartisan oversight committee, rather than a committee run only by the Democrats, as Dodd and Frank had proposed. They took out special interest boondoggles for unions and for ACORN, the voter fraud organization. They removed a provision that would have allowed bankruptcy judges to arbitrarily reduce mortgages, an ill-conceived measure that would have aggravated a central cause of the current crisis, the difficulty of evaluating mortgage-backed securities. And they mandated a GAO study on the impact of the mark-to-market accounting rule, implicitly encouraging regulatory agencies to revise or abandon that principle, which is a key reason why banks that have little to do with the origins of the crisis are currently threatened.

The insurance approach was always central to the House Republicans’ alternative to the Paulson and Frank-Dodd proposals. Whether their impact on the final product is profound, as opposed to merely helpful, depends on whether the insurance program is implemented and becomes a significant brake on taxpayer exposure.

The role played by John McCain appears to have been a constructive one. He supported and worked with the House Republicans. The Democrats no doubt wanted his support for the final product, and that must have enhanced the Republicans’ position at the table. The Democrats would not have wanted an unpopular bailout plan to be supported by Barack Obama and opposed by McCain.

If voters understood the events of the last week, they would probably return control of the House, and perhaps the Senate, to the Republicans. The mainstream media will make sure that doesn’t happen.”

Applying Occam’s Razor, I have thought all through this fiasco that the backstory is a clear threat from China, which nobody can talk about. It is my belief that China has been dictating to Paulson/Bush/Bernanke to back Chinese debt with the Treasury ‘or else’. I suspect this is what was revealed to Congress behind closed doors.

Will Gingrich’s reluctant, watered-down endorsement make conservatives more willing to accept this solution?

In a word, NO.

What happened to Newt’s original 4-point plan? Is there no one we can trust anymore?

Gingrich’s four-point plan includes: (1) suspending immediately mark to market provisions (the accounting practice of valuing a financial position in an investment at its current market price) in the hopes of stopping the downward spiral in asset values and eventually replacing it with a three year rolling average; (2) repealing immediately Sarbanes-Oxley, the 2002 accounting law Gingrich described as “an enormous drag on small business”; (3) setting the capital gains tax rate at zero “matching the Chinese and Singapore” (to encourage private capital to flood into the market picking up properties without the taxpayers being at risk); and (4) passing an “extraordinarily powerful” energy bill (“to return $500 billion a year to the American economy that are currently going overseas”).

The economy is getting dragged down a rabbit hole, and the government is going to latch on and try to pull it out. Is the rabbit hole large enough to swallow the government as well, because if it is then this will make the crisis even worse than the 30s.

Just saw an Obama spokesman on Fox and it made me gag. They’re spinning that OBAMA has been in touch often (I guess from the phone, when he’s not on stage telling lies or in the gym working on his jumpshot) and that McCain has just been “hanging out” in D.C. and actually in the way. Classic.
If anything can be taken from this, it’s that McCain actually played an important role in getting a compromise. Obama was absolutely a non-factor and YOU KNOW if you were able to give the Dim leadership truth syrum (yeah, like that would work) they’d tell you how pissed off they are about even having to pretend The One was any help at all.

If voters understood the events of the last week, they would probably return control of the House, and perhaps the Senate, to the Republicans. The mainstream media will make sure that doesn’t happen.”

rplat on September 28, 2008 at 3:41 PM

Yep. I’m so ticked at the lying, mostly by omission, at ABCBSNBC. The Democrats got us in this mess and there isn’t a bail out on earth that can get us out. There isn’t an ABCBSNBC that will tell the truth about it either. Fasten your seat belts. Life is fixin’ ta get interesting. (I pray not too interesting)

The entire This Week panel segment with George Will, Robert Reich, Steve Pearlstein and Newt was interesting. I haven’t watched This Week in years and probably won’t again, but the last thing I expected from Steponallofus was a roundtable 3-to-1 against his Clinton buddy Reich.

This is not about compassionate conservatism. This is about whether or not we sit back and allow a collapse of the financial markets.

I think a lot of the people who seem to be against this assume it would not affect them, their jobs, their lives, their homes, their futures and so they think it is all about compassion. It is not, it is just not common sense to embrace disaster.

Will there be an effort by the American public to DEMAND INVESTIGATIONS of all those in power (whether Dem, GOP, or Ind)who supported Fannie/Freddie, et.al. and those who took money from these entities?

HOW CAN THERE NOT BE INVESTIGATIONS into the people who so gregiously acted and supported these entities that has put our economy on the brink?

Right On. Some conservatives said that they would “stay home” this year because of McCain. You still have house/senate/local…..if you don’t show, it will be 2006 all over again.
HornetSting on September 28, 2008 at 4:08 PM

Might as well stay home with that mentality you describe. In for a penny, in for a pound. Right? Let democrats rule us for 4 years. Maybe even 8 years. Why stop there?

Where is the accountability?LordMaximus on September 28, 2008 at 4:22 PM

MCCAIN: Sure. But — but let me — let me point out, I also warned about Fannie Mae and Freddie Mac and warned about corporate greed and excess, and CEO pay, and all that. A lot of us saw this train wreck coming.

But there’s also the issue of responsibility. You’ve mentioned President Dwight David Eisenhower. President Eisenhower, on the night before the Normandy invasion, went into his room, and he wrote out two letters.

One of them was a letter congratulating the great members of the military and allies that had conducted and succeeded in the greatest invasion in history, still to this day, and forever.

And he wrote out another letter, and that was a letter of resignation from the United States Army for the failure of the landings at Normandy.

Somehow we’ve lost that accountability. I’ve been heavily criticized because I called for the resignation of the chairman of the Securities and Exchange Commission. We’ve got to start also holding people accountable, and we’ve got to reward people who succeed.

But somehow in Washington today — and I’m afraid on Wall Street — greed is rewarded, excess is rewarded, and corruption — or certainly failure to carry out our responsibility is rewarded.

As president of the United States, people are going to be held accountable in my administration. And I promise you that that will happen.

So, let me get this straight. You all want a market crash a month before the next elections?

Are all of you willing to lose your jobs and homes and retirement funds? I know that Pence can say what he likes, as long as he gets elected here in Indiana the tax payer will take care of him. But what about everyone else?

If it were not for compassionate conservativism we would not have a $10 trillion debt and this $700b while large would not have been that big a deal. We as a country are broke. compassionate conservatism was the reps way of trying to buy votes. 2006 and it looks like 2008 show the failure of that idea. We can not be democratic lite. we need to bne a strong vocal minority/majority with our own view of things. I agree this bailout was needed but it was conservatives that made a very bad bill less so. The compassionate crowd wanted to go full steam ahead with the bill and give the dems everything they wanted. They were not prepared to figth for any principles of theirs as long as they got their money. Seems like how the reps caved all thru 2001-2008. As long as the dems didn’t stop them from spending money the compassionate conservatives gave the dems anything they wanted….

When the Democrats took over in 2006 we had a smaller deficit than we do now. The Democrats are not compassionate conservatives. And Reagan was not above running deficts either and he was not a compassionat conservative, or at least that is what I have been told.

And this stuff did not start with Bush and compassionate conservatives, it started when Clinton was president and Newt Gingrich was Speaker of the House.

Now I am glad that they got changes, but then again in the end even people like Newt Gingrich admitted something had to be done. Just blaming this on compassionate conservatives is too simple.

Will there be an effort by the American public to DEMAND INVESTIGATIONS of all those in power (whether Dem, GOP, or Ind)who supported Fannie/Freddie, et.al. and those who took money from these entities?

HOW CAN THERE NOT BE INVESTIGATIONS into the people who so egregiously acted and supported these entities that has put our economy on the brink?

Just Mind-boggling.

Where is the accountability?

LordMaximus on September 28, 2008 at 4:22 PM

This is only thing you can be certain of–heads will roll after the fiscal damages are totaled. As we type thousands of attorneys are preparing their cases in an attempt to get money returned to their clients.

When they don’t get any money back they will want to know why and then the criminal pursuit takes place. Think Enron on a mega scale. As always the attorneys will make all the money.

the dems are socialists. Bush was eleceted asa conservative he ruled like a socialist. His spending was greater then LBJ and the great society. The massive gov spending also fed the credit bubble. You put that much money into the system you will get bubbles.

Yes the bad loans and such are not the reps fault, they take blame for it as much as dems. The problem is that we have moved away from individual freedom and responsibility. to groupthink.

Because it would interfere with the bipartisan narrative that has become the centerpiece of Maverick’s campaign.

2) If Obama wins, the question remains, will the American people DEMAND investigations?

Those who do so will be ignored. However, they are still a sizable percentage of the population and most of them reside in so-called red states – the very states that will, in time, secede from the People’s Republic of the United States.

Pelosi about to speak on how she and Obama saved the world, grabbed Wall Street by the scruff of the neck, and brought solvency to the markets. What do you want to bet that the first promise to be broken will be the one where they promised to make the bill available online for at least a day before the vote?

Yep. I’m so ticked at the lying, mostly by omission, at ABCBSNBC. The Democrats got us in this mess and there isn’t a bail out on earth that can get us out. There isn’t an ABCBSNBC that will tell the truth about it either. Fasten your seat belts. Life is fixin’ ta get interesting. (I pray not too interesting)

The most anticipated market rally in history is all set to begin Monday when taxpayer money is used to nationalize banks and socialize bad debts, against all the theories of capitalism and free markets. Not to mention changing the rules of law and regulation.

Oh yes, great investment opportunity, as if the details of the bailout were never disclosed in advance. Please act surprised if it passes and feel confident your stock purchase will appreciate in value rapidly. We’re all witnessing history in the making, and we’re all going to be richer than our wildest dreams.

Don’t worry about him, he is ALL IN. He can’t even allow anyone to question the motives of the Maverick.
HornetSting on September 28, 2008 at 4:37 PM

What??? Question all you want, as much as you want. If it’s a BS question, don’t be surprised if I challenge it. If it’s legitimate, then I’ve got no problem with that.

Now that the election is down to two people, it’s time to pick one or the other. Maybe some people want to act like democrats and trash McCain. I can’t stop them. I plan on doing everything I can to make sure that Obama is defeated, and McCain is victorious. I only have one vote, and my voice here. That’s it.

Ha! Classic. Denis Kucinich was on FOX saying he will not vote for this bill unless alternatives are viwed first. What do you want to bet that he and others will begin a second push to the left, begin stripping from the actual bill what has made some Republicans think they’ve won. Either that or they will demand language that all but negates what we’ve “gained”. YOu’ve got to give it to the Dems. they know the game, don’t they?

Now that the election is down to two people, it’s time to pick one or the other. Maybe some people want to act like democrats and trash McCain. I can’t stop them. I plan on doing everything I can to make sure that Obama is defeated, and McCain is victorious. I only have one vote, and my voice here. That’s it.

Now that the election is down to two people, it’s time to pick one or the other. Maybe some people want to act like democrats and trash McCain. I can’t stop them. I plan on doing everything I can to make sure that Obama is defeated, and McCain is victorious. I only have one vote, and my voice here. That’s it.

wise_man on September 28, 2008 at 4:50 PM

For the final time, YES, YES, I AM VOTING FOR JOHN MCCAIN. I would rather cut off my own head then see Obama become president. BUT, that does not mean I cannot question McCain’s behavior, the fact that he is allowing the dems to roll over the repubs on this, getting great soundbites about this whole thing being Obama’s idea…the changes and the things the REPUBS fought for. You know, if McCain went out and discussed what he did and what the repubs did for the American people on this, we would at least have a counterattack against the bs coming from the dems.
Instead, they send out this tool, Senator Gregg to discuss the plays by the repubs. He sux as a messenger.
McCain has to strike now, while the iron is hot. Instead, he is “making phone calls….I know he is working the problem, he needs to let us know what he is doing…he needs to strike now.

McCain has to strike now, while the iron is hot. Instead, he is “making phone calls….I know he is working the problem, he needs to let us know what he is doing…he needs to strike now. – HornetSting on September 28, 2008 at 5:01 PM

Whether or not John McCain is elected president will be determined largely by his own actions in the next week.

You are right but the fact that they even allowed the House Republican to get involved was because of the phone calls and emails they were getting. It suddenly dawned on them they had to have bi-partisan support. I still have serious doubts whether they will get it. If the Representative is up for election this year, I bet it is a NO vote.

1) Why isn’t the McCain camp (or through proxies) naming names then?
Because it would interfere with the bipartisan narrative that has become the centerpiece of Maverick’s campaign.

So saith ManlyRash on September 28, 2008 at 4:41 PM

AND they are hoping the 527’s along with the internet will do their jobs for them. AND because WE must remember it is NOT our votes the Mav is trolling for. Most of us get the difference between Mav and Manchild. We get that Americans have no fighting chance if MANCHILD is elected. This was for the indies and those of the fair sex that do not like for men to fight. UGH! I am not one of those thank GOD!

This was done by the Mav because this is the way he works, he would have done this anyway, AND the Mav is going to now be able to utilize his actions on this bill as a club to bang MANCHILD about the head and neck in the upcoming economic debates.

Well, that is IF Mav really wants to win he will do that. Can you not just hear these responses from McCain, “How would you know Senator Obama? You were in the gym!” or “Is that what Speaker Pelosi told you? That is not what the House members told me and wrote in their letter to Speaker Pelosi!” or “What bipartisan efforts Senator Obama did you make in order to have something achieved by the opening Asian markets?” “Other than speaking with Paulson, who is a Dem anyway, which GOP member of the House did you work with?” and the ultimate, “Senator Obama, I was not for this bill that President Bush proposed! You were 100% for the Bush bill as proposed by Paulson. Experts said it was bad and I opposed Bush and the Paulson bill. It was YOU, sir that was on Bush’s side on this matter!”

I believe indies, some silly female voters and the public in general see the actions of these two men vastly differently than those in the Beltway press, pundit types. If Obama tries to slam McCain on this he looks weak or bad for not going to Washington, not even for the people of IL. The President had to call him to Washington. He screwed up that meeting. He did not LISTEN, and women LOVE listeners. McCain looks mature and unselfish regarding the campaign. And these indies are the touchy feely types that can get all warm and fuzzy over, “McCain loved me by sacrificing his campaign for me.”

I think, not believe at this point, but think the naming of names is not something that would benefit McCain in totality. Until this is over, I doubt we are going to hear names. Besides, when has McCain made anyone famous other than fights with Conservatives?

If you think Bush is a socialist you need to spend some time in Venezuela.

We used to have a Congressman here in the 8th District of Indiana. His name was Hostettler, he was very conservative. He was no clone Bush. He got beat by 2 to 1 in 2006, here in Indiana. The man who beat him was a moderate Democrat and former Sheriff named Brad Ellsworth. He won because Hostettler was considered too conservative in a district that has gone red in every presidential election for over 40 years.

Now for years I have heard Bush called a fascist, a right wing extremist, a social conservative, but now you are telling me he is a socialist.

You know when you think about the spending, you have to keep in mind the events of the last decade. If not for Katrina, 9/11 and this financial crisis I doubt very much if Bush would have been known as a big spender. And those events were not in his control. An argument could be made that this financial crisis could have been headed off. But to be honest, if people do not believe it is happening when we are in the midst of it they would not have believed it 4 years ago. They would have blown off the idea of credit sector reform just like they did social security reform. I remeber then they said Bush was a right wing extemist too. After all, he wanted to privatize social security.

Maybe it is time to learn something from the Democrats. They don’t care what their folks in Congress do as long as they stay in power. The Right, on the other hand, will spank our politicians. I know we are doing the right thing when they don’t stand by our principles but it hard to watch the other side take advantage.

The broader debt markets were crippled by fears on Friday after the sale of WaMu. Unlike other recent bank deals, this one saw senior creditors wiped out alongside shareholders – an unexpected blow.

The wipeout of WaMu bonds is likely to make it much more difficult for any struggling US bank to raise new finance.
If bondholders can be wiped out so easily, there is little point in extending debt to struggling firms.
The added uncertainty is likely to make it harder for all companies to renew their debt facilities, and put a further squeeze on the price.

Bizzy comments:
Chances are very great that the uncertainty will bleed into the equity markets, perhaps even giving Paulson & Co. the 1/3 meltdown “Treasury officials have warned of.”

I detect a whiff of financial sedition.

This is EXTREMELY IMPORTANT!!

I’m not one for conspiracy theories, because I believe it has to do with laziness and incompetence on the governing bodies’ responsibilties.

Having cleared that up, IT IS HIGH TIME that we get this out in an open debate, so that the truth can shine on it and thereby get resolved!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I believe a portion of the fodder that conspiratorial groups have is unfinished debate of real issues and need to be snatched from them, owned and brought into open debate.

THIS IS THE TIME TO SUMMON EVERY AMERICAN THAT LOVES THIS COUNTRY AND GO TO WASHINGTON, VIRTUALLY AND IN PERSON, WITH “PITCHFORKS AND GUNS” (metaphorically speaking of course) AND LET OUR ELECTED OFFICIALS UNDERSTAND ONCE AND FOR ALL WHO OWNS THEM AND THIS COUNTRY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Dude. Just because I’m commenting on what your commenting on doesn’t mean that everything I say is directed solely at you and you alone. Sorry if while your read my comment, you might have thought that I was pointing a finger at you and making a frowny face, cause I wasnt. Again, sorry.

Dude. Just because I’m commenting on what your commenting on doesn’t mean that everything I say is directed solely at you and you alone. Sorry if while your read my comment, you might have thought that I was pointing a finger at you and making a frowny face, cause I wasnt. Again, sorry.

wise_man on September 28, 2008 at 5:20 PM

Wise, we are on the same page, we are just coming from different corners. I just felt like you have a problem with ANYONE saying anything against the Maverick. I believe, in a fight of two, he is the best candidate. But, he is now the “standard bearer” of our party and he is silent while the democrats convince the masses that they are the ones that fought for the American people. Oh, and not a dude. We are all of the same mindset here, but we are not in a communist state, yet, anyway.